Original equipment manufacturer (OEM) Desktop Metal (NYSE: DM) announced that the company has received a $9 million order from a “large German car manufacturer.” Although it is not clear which platform was purchased in particular, DM noted in the press release that the order was for a metal binder jetting system.
According to DM, this is the second platform ordered by the same German company in less than a year, which brings the purchases by said unnamed car manufacturer to a total of $16.9 million during that timeframe. This latest sale was for a platform that will be used in the production of powertrain components for the commercial auto market.
In the press release announcing the German car manufacturer’s latest purchase, founder and CEO of DM, Ric Fulop, commented, “The additive manufacturing [AM] industry continues to grow for mass production applications…Our team is working with a significant number of global automotive OEMs to expand adoption of our differentiated AM technologies for end-use car components, and this most recent order further demonstrates our customer’s success changing the way they make products and supports Team DM’s vision for [AM] 2.0.”
It is not news that, against the backdrop of a generally dismal 2022 for American equity markets, OEMs in the AM sector have had an especially difficult year. Unsurprisingly, companies such as DM, which went public not long before markets saw their peaks in 2021, have endured the most challenging operating conditions.
In a recent interview with 3DPrint.com’s editor-in-chief, Michael Molitch-Hou, Fulop acknowledged the macro difficulties that all companies have faced this year. Echoing financial analysts’ increasingly pessimistic consensus about the trajectory of the global economy, Fulop cautioned that the unforgiving fiscal environment is likely to continue into 2023.
On the other hand, I’ve noted before that, for the AM sector, there is a silver lining to take away from a rough 2022: any company that survives it will have proven its tenacity and adaptability to investors. As for DM, the European auto market could turn out to be one of the best sectors for an AM hardware firm to have exposure to.
Put simply, no one knows what will happen next year. In this sense, at least for some companies, there is perhaps just as much reason to think that the bleakness of 2022 is a sign that a bottom is being reached, as there is to think that it forebodes a far worse financial climate in the near-term.
Images courtesy of Desktop Metal